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3.4. My company’s account is still being audited or yet to be signed by the Directors. What type of information or document is required to be submitted?

3.5. Is there any penalty imposed on company which fails to submit the Income Tax Form within the stipulated time frame?

3.6. What are the documents needed to be submitted to the Collector of the Income Tax when submitting the tax returns?

3.7. My company is dormant. Do I still need to return the Income Tax Form?

4. Payment of Tax

4.1. When is the payment for the Notice of Assessment due?

4.2. Where do we make tax payment?

4.3. Can the tax payment be made via telegraphic transfer?

5. Assessment

5.1. What happens if company fails to respond to tax queries raised by the Collector of Income Tax?

5.2. A company incurred losses for several years. After that, the company is dormant. Can the losses and capital allowances be carried forward to the subsequent years when the company begins to become active again?

6. Penalty for Late Payment

6.1. What happens if a company is late in making payments?

6.2. Why does a company need to pay the penalty eventhough an objection has been raised against the Notice of Assessment?

7. Tax Refund

7.1. What are the terms for applying tax refund?

7.2. Once appeal for refund is approved, what does the company need to do?

8. Withholding Tax

8.1. What is withholding tax?

9. Stamp Duty

9.1. What is stamp duty?

9.2. Give examples of types of instrument or document which are charged with stamp duty?

9.3. When is the due date for stamping an instrument?

9.4. Where can I get my document stamped?

9.5. Is there a penalty on late stamping?

10. Licence for Auditor

10.1. How to apply for Auditor’s Licence?

10.2. What are the qualification required for applying the Auditor’s Licence?

10.3. How much is the Auditor’s Licence fee?

10.4. How long is the Licence valid for?

10.5. What are the terms for renewal of Auditor’s Licence?

1.1. What type of income is taxable in Brunei Darussalam?

Ans: Income Tax is charged to company incorporated or registered under the Companies Act (Chapter 39) or any law elsewhere with limited liability which derived from, received in Brunei Darussalam in respect of gains or profits from any trade, business, profession or vocation. This Act shall not have effect in respect of incomes of any other persons or bodies of persons.

Currently, no tax is levied on unincorporated companies (sole proprietorship, partnership), personal income and capital gains.

1.2. What is the tax rate levied on a company?

Ans: The normal corporate tax rate shall be levied and paid for each Year of Assessment upon the Chargeable Income of every company tax at the rate of 30 per cent on every dollar of the Chargeable Income. For companies engaged in the operation of oil and gas, tax is levied at a rate of 55 per cent.

Effective from 2008, the corporate income tax rate chargeable under section 35 of the Income Tax Act (Cap 35) is revised as follows:

         ♦   For the Year of Assessment 2008 – 27.5%
♦   For the Year of Assessment 2009 – 25.5%
♦   For the Year of Assesment 2010 - 23.5%
♦   For the Year of Assessment 2011 and subsequent Years of Assessment - 22%

2.1.           How do we get the form on company’s particulars?

Ans: The Request for Company's Particulars Form (RFPF) can be obtained from the Revenue Division, Ministry of Finance during office hours.

2.2.           My company’s address has been changed. Do I have to inform the Collector of Income Tax?

Ans: Yes, any changes on the company's particulars have to be informed in writing to the Collector of Income Tax.

3.1.           When is the Income Tax Form issued?

Ans: The Income Tax Form is issued by the Collector of Income Tax annually, in early January. This form will be sent by post to the company's registered office address.

3.2.           My company has accrued profits during a financial year but I have not received the Income Tax Form. How do I get the form?

Ans: The form can be obtained from the Revenue Division, Ministry of Finance during office hours.

Please also take note that according to Section 53 of the Income Tax Act states that every persons chargeable with tax for any Year of Assessment who has not been required within 3 months after the commencement of such Year of Assessment to make a return of his income for that year as provided in Section 52 shall within 14 days after the expiration of that period give notice to the Collector that he is so chargeable.

3.3.           When is the time that a company requires to return the Income Tax Form to the Collector of Income Tax?

Ans: The original, signed and completed Income Tax Form should be returned to the Collector of Income Tax, Ministry of Finance within 3 months from the date it is issued.

3.4.           My company’s accounts are still being audited or yet to be signed by the Directors. Can I apply for extension of time to file a return?

Ans: Before any extension of time can be granted, a company which is unable to submit its tax return within the stipulated period of time is required to inform in writing, the reasons for non-submission to the office of Collector of Income Tax. In addition to that, the company is required to furnish or notify to the Collector whether he is so chargeable and to submit draft financial accounts.

3.5.           Are there any penalties imposed on a company that fails to submit the Income Tax Form within the stipulated time?

Ans: Section 78 of the Income Tax Act states that every person who without reasonable excuse fails to comply with the requirement of a notice given to him under Section 52 to submit Income Tax Returns shall be guilty of an offence against the Income Tax Act, and shall be liable on conviction, to a fine of B$10,000 and in default of payment to imprisonment for 12 months.

3.6.           What are the documents required to be submitted together with the Income Tax Returns?

Ans: Tax returns should be completed, signed and submitted to the Collector of Income Tax together with:

i)    Signed and audited accounts including Profit & Loss Account and Balance Sheet;
ii)    Tax Computation;
iii)    Breakdown of fixed assets for computation of Capital Allowance;
iv)    Other supporting documents in relation to company's claims;
v)    Any additional information and documents that are required by the Collector from time to time.

3.7.           My company is dormant. Do I still need to file the Income Tax Form?

Ans: Even if the company is dormant, it is still required to file a "NIL" return.

4.1.           When is the payment for the Notice of Assessment due?

Ans: Section 70 of the Income Tax Act (Chapter 35) states that a company is required to pay Income Tax within 30 days from the date of the Notice of Assessment is issued eventhough the company has made an objection to the assessment.

4.2.           Where do we make tax payment?

Ans: Tax can be paid at the office of Collector of Income Tax during office hours at:

Revenue Division
Ministry of Finance
Level 1, Island Block
Ministry of Finance Builiding
Commonwealth Drive BB3910
Brunei Darussalam

Opening hours:     8.00am to 12.00pm
                         1.30pm to 4.00pm      (Monday to Thursday & Saturday)

NOTE: Crossed cheque payable to the "Government of Brunei".

4.3.           Can the tax payment be made via telegraphic transfer?

Ans: Yes. Payment can be made via telegraphic transfer or using bank's draft. The remittance slip should contain the following information:-

-    the company's name
-    tax reference number
-    purpose of the payment

Payment remitted must be in Brunei Dollars with instructions to the bank that the telegraphic transfer/bank charges will be borne by the applicant.

5.1.           What happens if a company fails to respond to tax queries raised by the Collector of Income Tax?

Ans: If a company fails to respond to tax queries raised by the Collector of Income Tax, assessment will be made by disallowing any expenses related to those queries which were not furnished as called for.

5.2.           After incurring losses for several years, a company is dormant. Can the company carry forward the losses and capital allowances to the subsequent years when it is actively back in business?

Ans: Company can only carry forward the capital allowance during the dormant period and subsequently to the active years.

However, the losses from previous years are only allowed to be carried forward once the company is actively back in business.

6.1.           What happens if a company is late in making payments?

Ans: If a company fails to pay its tax liability within 30 days from the date of the Notice of Assessment, a Demand Note will be sent out to instruct payment for outstanding tax plus 5% penalty.

Should the company fail to pay after 60 days from the date of Demand Note, an additional penalty of one percent (1%) per month is imposed on the tax that remains unpaid for each completed month up to a maximum of twelve percent (12%).

Legal proceedings will also be taken against the company once it fails to comply with the Notices.

6.2.           Why does a company need to pay the penalty eventhough an objection has been raised against the Notice of Assessment?

Ans: Eventhough an objection has been raised against the Notice of Assessment, the company has to pay or arrange for payment within 30 days from the date of the Notice of Assessment.

7.1.           What are the terms for applying tax refund?

Ans: The terms are as follows:

1. If there is a difference between the tax paid and the tax payable in the Notice of Assessment. Often, this applies to Estimated Notices of Assessment raised by the Collector of Income Tax, which has been paid.

2. Payments have been made twice for the same assessment year due to delay in payment via telegraphic transfer provided that appeal for refund is made within 60 days from the date of Assessment.

3. Appeals made against Notice of Assessment is accepted by the Collector of Income Tax.

7.2.           Once appeal for refund is approved, what does the company need to do?

Ans: A company is requested to return the original receipt of payment to the Collector of Income Tax.

8.1.           What is withholding tax?

Ans: When a person pays interest due under a charge, or debenture or loan interest, to a person not resident in Brunei Darussalam, withholding tax in Brunei Darussalam is twenty percent (20%) on every dollar of such interest.

9.1.           What is stamp duty?

Ans: Stamp Duty is a tax which is charged on a commercial and legal document which record and give effect to certain transactions as stated in the First Schedule of the Stamp Act (Chapter 34).

9.2.           Give examples of types of instrument or document which are charged with stamp duty?

Ans: The documents are:

    i)    Tenancy or Lease Agreement
    ii)    Share Certificate
    iii)    Transfer of Share
    iv)    Assignment of Monies, Bill of Exchange
    v)    Conveyance
    vi)    Covenant
    vii)    Declaration of Trust

9.3.           When is the due date for stamping an instrument?

Ans: Stamp Duty is payable anytime before executing the document. However, once it is executed in Brunei Darussalam, it must be stamped within 14 days after Notice of Assessment; and if executed out of Brunei Darussalam, it must be stamped within 30 days after it has been first received.

9.4.           Where can I get my document stamped?

Ans: Document(s) can be stamped during office hours at:

Revenue Division
Ministry of Finance
Level 1, Island Block
Ministry of Finance Complex
Commonwealth Drive
Brunei Darussalam

Opening hours:    8.30am to 12.15pm
                        1.30pm to 3.30pm        (Mondays to Thursdays & Saturdays)

If payment is received from overseas, it must be inclusive of postal charges to return the document(s).

9.5.           Are there any penalties on late stamping?

Ans: Yes, there is a penalty for late stamping on instrument executed in Brunei Darussalam as follows:

In a case where an instrument or a document is submitted to be stamped 14 days after it has been executed or first received in Brunei Darussalam, the penalty is double the amount of deficient duty or a penalty of B$10, whichever sum is higher.

In a case where an instrument or a document is submitted 30 days it has been executed, a penalty five times the amount of deficient duty or a penalty of B$25, whichever sum is greater, is charged.

Example:

i) More than 14 days

Instrument/Document

Stamp Duty

Double

Penalty

Share Certificate

10 cents

20 cents

B$10.00

Penalty charged is B$10.00

ii) More than 3 months

Instrument/Document

Stamp Duty

5 times

Penalty

Share Certificate

10 cents

50 cents

B$25.00

Penalty charged is B$25.00

10.1.       How do I apply for Auditor’s Licence?

Ans: An applicant has to fill in a form available from Revenue Division, Ministry of Finance.

The form is to be submitted together with the following documents:
    i)    curriculum vitae
    ii)    copies of qualification certificates
    iii)   Supporting letter from ex-Auditor's firm where the applicant formerly employed.

10.2.       What are the qualification required for applying the Auditor’s Licence?

Ans: According to Companies Act (Authorised Auditor's Regulation, 1997), each applicant must comply and possess the following terms and qualifications:-

- Qualified as a Chartered Accountant (ACCA, CPA etc);
- Has worked with International Auditor's firm for not less than 5 years;
- Has auditing experiences for a period not less than 5 years;
- Holding a position of at least as a Auditor's Trainer in an auditing firm;
- For applicant holding a Green Identity Card must have a local partner.

10.3.       How much is the Auditor’s Licence fee?

Ans: The annual fee is B$2,500.00.

10.4.       How long is the licence valid for?

Ans: Auditor's licence is valid for a period of 1 year beginning January until December.

10.5.       What are the terms for renewal of Auditor’s Licence?

Ans: The licence has to be renewed 3 months before the expiring date.

The terms are the auditor:-

1. must reside in Brunei Darussalam for not less than 90 days in a year for Green/Purple Identity Card applicant;
2. hold a Yellow/Purple Identity Card and must have a local partner;
3. must submit an audit program for the next 3 years.

Updated as of 14 September 2010

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